BRM – February 2025 monthly update

1
A WORD FROM THE MANAGER
Barramundi’s gross performance return for January was
+3.4% and the adjusted NAV return was +3.3%. This
compares to the S&P/ASX200 Index (70% hedged into NZ$)
which was +4.5% over the month.
In a relatively light month for company specific news flow, the
Australian equity market’s return correlated with the positive
start to 2025 for major global equity markets. The Australian
market’s rally was broad based with 10 of the 11 sectors
finishing the month in the green.
The Consumer Discretionary sector (+7.1% in A$ in the
period) led the market higher. Gambling businesses Tabcorp
(+20%) and Aristocrat (+11%) were meaningful drivers for
the sector. Resilient consumer spending through December,
in contrast to NZ, generally saw good performance from
the retailers with share prices of Harvey Norman (+11%), JB
Hi-Fi (+10%) and Super Retail (+3%) responding accordingly.
Financials (+6%) (see commentary on the banks below) and
Real Estate (+5%) also rose strongly.
Utilities (-2%) was the only sector with negative performance
in the month.
Portfolio Commentary
During the month Cochlear (+10%) received regulatory
approvals in Australia and Canada for its new Kanso 3 sound
processor. It will look to gain broader geographic approvals
through 2025. The Kanso is Cochlear’s sound processor that
sits in the hairline instead of on-the-ear. Cochlear typically
look to launch a new processor every other year, alternating
between the Kanso (off-the-ear) and Nucleus (on-the-ear)
processor. The latest processors bring a mix of improved audio
and connectivity, are smaller and lighter, and typically lead to
users upgrading from the older generations.
Resmed (+9%) delivered a strong Q2 FY25 result. Earnings
for the quarter were up by +29% and slightly ahead of
expectations. Revenue grew by 10% in constant currency
terms, with all regions and products growing at a high single
or low double digit pace. Gross margin improved markedly
versus a year ago but was flat sequentially on Q1 due to
the FX headwind of a strong US$. Relative to revenue, both
operating expenses and Research and Development spend
continued to demonstrate operating leverage versus a year
ago and sequentially. The combination of +10% top line
growth and continued margin improvement delivered a +20%
lift in EBIT. All the channel checks that we have participated
in recently have suggested a healthy flow (pun intended!)
of new patients into the sleep apnea treatment funnel.
We expect Resmed to maintain its current good earnings
momentum through H2 FY25.
Helped by strong earnings results, many large global banks
had a strong January from a share price perspective. This
arguably helped buoy a number of our financial investments
with NAB (+8%), ANZ (+7%) and CBA (+5%) continuing
their share price rally into 2025. The Australian regulator
APRA released their monthly banking statistics for December
in the month, highlighting the strength of credit growth
in the Australian economy. Business credit growth for the
industry increased 9.8% (annualised) and housing credit
growth registered a 5.9% increase, reinforcing the resilience
of the Australian economy. Early indicators also point to
robust consumer spending through Christmas which lifted
share prices of the Australian retailers. This likely also boosted
investor sentiment for the banks.
Macquarie (+9%) likewise had a strong start to the year. In
addition to the themes bolstering the retail banks it likely also
benefitted from buoyancy (and volatility) in global financial
markets over the last few months. This is a positive portent
for future profitability within its investment banking business
as well as within its trading businesses which can profit from
volatility, especially within global energy markets.
PWR Engineering (+4%) announced it had secured its
largest Aerospace (“A&D”) contract to date. The A&D division
was established in 2020, and the contract provides the
first validation for the heavy investment in this new growth
vertical. Much of the miss to earnings in the FY24 result was
a consequence of PWR investing in skilled people needed to
win contracts in the A&D industry. This contract, if delivered
successfully, has the potential to bring further long-term
opportunities using the same platform of technologies. It
highlights the large addressable market PWR has unlocked.
1
Share Price Discount to NAV (using the net asset value per share, after expenses, fees and tax, to four decimal places).
MONTHLY UPDATE
February 2025
$
0.71
SHARE PRICE
as at 31 January 2025
DISCOUNT
1
7.0
%

BRM NAV
$
0.76

SECTOR SPLIT
as at 31 January 2025
KEY DETAILS
as at 31 January 2025
FUND TYPE
Listed Investment Company
INVESTS IN
Growing Australian companies
LISTING DATE
26 October 2006
FINANCIAL YEAR END
30 June
TYPICAL PORTFOLIO SIZE
20-35 stocks
INVESTMENT CRITERIA
Long-term growth
PERFORMANCE OBJECTIVE
Long-term growth of capital and
dividends
TAX STATUS
Portfolio Investment Entity (PIE)
MANAGER
Fisher Funds Management Limited
MANAGEMENT FEE RATE
1.25% of gross asset value
(reduced by 0.10% for every 1%
of underperformance relative to
the change in the NZ 90 Day Bank
Bill Index with a floor of 0.75%)
PERFORMANCE FEE
HURDLE
Changes in the NZ 90 Day Bank
Bill Index + 7%
PERFORMANCE FEE
10% of returns in excess of
benchmark and high water mark
HIGH WATER MARK
$0.71
PERFORMANCE FEE CAP
1.25%
SHARES ON ISSUE
336m
MARKET CAPITALISATION
$238m
GEARING
None (maximum permitted 20%
of gross asset value)
4
%
19
%
20
%

INDUSTRIALS
15
%
COMMUNICATION
SERVICES
22
%
2
%
3
%

FINANCIALS
CONSUMER
STAPLES
MATERIALS
5
%
Credit Corp (-3%) delivered what we consider to be a good
result for H1 FY25, albeit slightly behind market expectations.
Its after tax profit was up by +32% on last year’s normalised
H1 performance (the reported H1 FY24 result was a loss
after impairing some US debt ledgers). The strong growth in
the latest half was due to the Consumer Lending business
where profit grew +79%. This reflected the larger size of the
lending book and a slower pace of lending growth, which
reduced upfront loss provisioning expense. The US Debt
Buying business lifted its profit by +16% (+20% constant
currency) on the back of improved collections and better
staff productivity. Profit for the ANZ Debt Buying operation
fell by 10% but should now be at a trough as Credit Corp’s
defaulted debt ledger purchases, which remain well below
pre COVID levels, are now at levels that should stop further
run-off in the book. The company maintained its guidance for
full year profit growth of +11-23%. The H1 run rate suggests
to us that the company should hit around the mid-point of its
guidance, so we’d expect around +18% earnings growth for
the full year.
Robbie Urquhart
Senior Portfolio Manager
Fisher Funds Management Limited
After a strong finish to the 2024 calendar year, insurance
software provider Fineos’s share price fell modestly (-3%) in
the month albeit there was no material news related to the
company. New addition to the portfolio, Maas Group (-5%)
also detracted from returns. Again, there was no material
news related to the business, albeit we note that Maas
undertook an equity raising late in 2024 to fund a clutch of
new acquisitions. This may have influenced the recent share
price movement. Both companies report financial results in
February, and we look forward to getting a business update
from them then.
Portfolio Changes
There were no material changes to the portfolio positioning in
January.
2
10
%
CONSUMER
DISCRETIONARY

HEALTH CARE

CASH &
DERIVATIVES
INFORMATION
TECHNOLOGY

JANUARY’S SIGNIFICANT RETURNS IMPACTING
THE PORTFOLIO during the month in Australian dollar terms
CAR GROUP
+13
%
COCHLEAR
+10
%
RESMED
+9
%
XERO
+9
%
JAMES HARDIE
+9
%
5 LARGEST PORTFOLIO POSITIONS as at 31 January 2025
WISETECH
7
%
CSL LIMITED
10
%
SEEK
6
%
MACQUARIE
GROUP
5
%
XERO
5
%
The remaining portfolio is made up of another 21 stocks and cash.
1 Month3 Months1 Year3 Years
(annualised)
5 Years
(annualised)
Company Performance
Total Shareholder Return+2.9%+6.9%+6.7%+4.5%+9.4%
Adjusted NAV Return+3.3%+2.2%+11.6%+9.8%+10.7%
Portfolio Performance
Gross Performance Return+3.4%+2.6%+14.2%+12.2%+13.0%
Benchmark Index^+4.5%+5.1%+16.7%+12.4%+8.9%
PERFORMANCE to 31 January 2025
3
TOTAL SHAREHOLDER RETURN to 31 January 2025
^Benchmark Index: S&P/ASX 200 Index (hedged 70% to NZD)
Non–GAAP Financial Information
Barramundi uses non–GAAP measures, including adjusted net asset value, adjusted NAV return, gross performance return and total shareholder return. The rationale for using such non–GAAP measures is as follows:
»adjusted net asset value – the underlying value of the investment portfolio adjusted for dividends (and other capital management initiatives) and after expenses, fees and tax,
»adjusted NAV return – the percentage change in the adjusted NAV,
»gross performance return – the Manager’s portfolio performance in terms of stock selection and currency hedging before expenses, fees and tax, and
»total shareholder return – the return combines the share price performance, the warrant price performance, the net value of converting any warrants into shares, and the dividends paid to shareholders. It
assumes all dividends are reinvested in the company’s dividend reinvestment plan, and that shareholders exercise their warrants, (if they were in the money), at warrant expiry date.
All references to adjusted net asset value, adjusted NAV return, gross performance return and total shareholder return in this monthly update are to such non–GAAP measures. The calculations applied to non–GAAP
measures are described in the Barramundi Non–GAAP Financial Information Policy. A copy of the policy is available at barramundi.co.nz/about-barramundi/barramundi-policies.
Share Price/Total Shareholder Return
$4.00
$3.50
$3.00
$2.50
$2.00
$1.50
$1.00
$0.50
$0.00
Oct
2006
Oct
2007
Oct
2011
Oct
2013
Oct
2014
Oct
2015
Oct
2008
Oct
2009
Oct
2010
Oct
2016
Oct
2020
Oct
2012
Oct
2022
Share Price Total Shareholder Return
Oct
2017
Oct
2018
Oct
2019
Oct
2021
Oct
2023
Oct
2024

Disclaimer: The information in this update has been prepared as at the date noted on the front page. The information has been prepared as a general summary of the matters covered only, and it is by
necessity brief. The information and opinions are based upon sources which are believed to be reliable, but Barramundi Limited and its officers and directors make no representation as to its accuracy or
completeness. The update is not intended to constitute professional or investment advice and should not be relied upon in making any investment decisions. Professional financial advice from a financial
adviser should be taken before making an investment. To the extent that the update contains data relating to the historical performance of Barramundi Limited or its portfolio companies, please note that
fund performance can and will vary and that future results may have no correlation with results historically achieved.
Barramundi Limited
Private Bag 93502, Takapuna, Auckland 0740
Phone: +64 9 489 7074
Email: enquire@barramundi.co.nz | www.barramundi.co.nz
4
Computershare Investor Services Limited
Private Bag 92119, Auckland 1142
Phone: +64 9 488 8777
Email: enquiry@computershare.co.nz | www.computershare.com/nz
ABOUT BARRAMUNDI
Barramundi is an investment
company listed on the New Zealand
Stock Exchange. The company
gives shareholders an opportunity
to invest in a diversified portfolio
of between 20 and 35 quality
growing Australian companies
through a single, professionally
managed investment. The aim of
Barramundi is to offer investors
competitive returns through capital
growth and dividends.
CAPITAL MANAGEMENT STRATEGIES
Regular Dividends
»Quarterly distribution policy introduced in
August 2009
»Under this policy, 2% of average NAV is targeted to be
paid to shareholders quarterly
»Dividends paid by Barramundi may include dividends
received, interest income, investment gains and/or
return of capital
»Shareholders who prefer to have increased capital rather
than a regular income stream have the opportunity to
participate in the company’s dividend reinvestment plan
(DRP)
»Shares issued to DRP participants are at a 3% discount
to market price
»Barramundi became a portfolio investment entity on
1 October 2007. As a result, dividends paid to New
Zealand tax resident shareholders have not been subject
to further tax
MANAGEMENT
The Manager has authority delegated
to it from the Board to invest according
to the Management Agreement and
other written policies. Barramundi’s
portfolio is managed by Fisher Funds
Management Limited. Robbie Urquhart
(Senior Portfolio Manager), Terry Tolich
and Delano Gallagher (Senior Investment
Analysts) have prime responsibility for
managing the Barramundi portfolio.
Together they have significant combined
experience and are very capable of
researching and investing in the quality
Australian companies that Barramundi
targets. Fisher Funds is based in
Takapuna, Auckland.
BOARD
The Board of Barramundi
comprises independent
directors Andy Coupe (Chair),
Carol Campbell, David
McClatchy and Fiona Oliver.
Share Buyback Programme
»Barramundi has a buyback programme in place allowing
it (if it elects to do so) to acquire its shares on market
»Shares bought back by the company are held as treasury
stock
»Shares held as treasury stock are available to be utilised
for the dividend reinvestment plan
Warrants
»Warrants put Barramundi in a better position to grow
further, operate efficiently, and pursue other capital
structure initiatives as appropriate
»A warrant is the right, not the obligation, to purchase an
ordinary share in Barramundi at a fixed price on a fixed
date
»There are currently no Barramundi warrants on issue